Contents Corporate Profile 2 Mission Statement 3 Financial Highlights 4 Retail Network 6 Chairman’s Statement 8 Management Discussion and Analysis 10 Directors and Senior Management 25 Corporate Governance Report 29 Directors’ Report 39 Independent Auditors’ Report 51 Consolidated Income Statement 53 Consolidated Statement of Comprehensive Income 55 Consolidated Statement of Financial Position 56 Consolidated Statement of Changes in Equity 58 Consolidated Statement of Cash Flow 60 Statement of Financial Position 63 Notes to Financial Statements 64 Corporate Information 168 Maoye International Holdings Limited Annual Report 2010 Corporate Profile Maoye International Holdings Limited (the “Company”) and its subsidiaries (the “Group”) are principally engaged in the operation and management of department stores in the People’s Republic of China (the “PRC”). The Company was incorporated in the Cayman Islands with limited liability on 8 August 2007. The shares of the Company were listed on the Main Board of The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) on 5 May 2008. The Group is positioned at the medium to high-end department store merchandise and offers a stylish and diversified merchandise mix for well-off urban residents. As a leading domestic operator of department stores, the Group operates department stores in the affluent and regions of China with high economic growth. Currently, the Group is strategically expanding into four regions: Guangdong Province which is economically developed, Sichuan Province which is one of the most densely populated regions, Jiangsu Province which ranks among the top three regions in terms of GDP, Shandong Province and the Bohai Rim region. As at the publication date of this annual report, the Group operates and manages 38 stores in 17 cities across the nation with total gross floor area of 1,123,793 square metres, of which self-owned properties accounted for 58.9% in gross floor area (excluding the gross floor area of managed stores). The cities under its coverage include Shenzhen and Zhuhai in Guangdong Province; Chengdu, Nanchong, Mianyang and Luzhou in Sichuan Province; Chongqing; Wuxi, Taizhou, Yangzhou and Changzhou in Jiangsu Province; Zibo in Shandong Province; Qinhuangdao and Baoding in Hebei Province; Shenyang in Liaoning Province and Taiyuan and Yangquan Shanxi Province. As at the publication date of this annual report, the distribution of stores of the Group are as follows: Southern Southwestern Eastern Northern China China China China Total No. of Stores 7139 938 Gross Floor Area (sq.m) 235,523 308,939 296,116 283,215 1,123,793 This annual report, in both English and Chinese versions, is available on the Company’s website at www.maoye.cn. Shareholders who have chosen to receive the corporate communications of the Company (the “Corporate Communications”) in either the English version or the Chinese version may request for a copy in the other language. The annual report in the requested language will be sent free of charge by the Company upon request. Shareholders may at any time change their choice of language(s) (either English only or Chinese only or both languages) of Corporate Communications. Shareholders may send their request to change their choice of language(s) of Corporate Communications by notice in writing to the Hong Kong Branch Share Registrar of the Company, Tricor Investor Services Limited at 26/F, Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong. 2 Maoye International Holdings Limited Annual Report 2010 Mission Statement To become a leading department store chain operator in China 3 Maoye International Holdings Limited Annual Report 2010 Financial Highlights The summary of the Group’s results, assets, liabilities and equity for the last five financial years are set out below: OPERATING RESULTS For the year ended 31 December 2010 2009 2008 2007 2006 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (restated) Total sales proceeds1 7,266,687 4,854,737 3,995,748 3,797,578 3,169,972 Total operating revenue2 2,748,350 1,832,071 1,967,435 1,922,939 1,651,702 Operating profit 917,441 702,749 740,478 643,222 233,097 Profit for the year 624,086 504,170 543,318 444,088 177,932 Profit attributable to: – Owners of the parent 576,597 470,107 520,969 416,999 217,059 – Non-controlling interests 47,489 34,063 22,349 27,089 (39,127) Basic earnings per share (RMB)3 0.11 0.09 0.11 0.10 0.05 Total dividend per share for the year (HK cents) 1.8 3.1 5.5 N/A N/A – interim 1.8 1.6 3.3 N/A N/A – final — 1.5 2.2 N/A N/A 4 Maoye International Holdings Limited Annual Report 2010 Financial Highlights Notes: 1. Total sales proceeds represent the sum of total sales proceeds from concessionaire sales and revenue from direct sales of the Group. 2. Total operating revenue represents the sum of the Group’s revenue and other income. 3. The calculation of basic earnings per share for the year ended 31 December 2010 is based on the net profit attributable to owners of the parent of approximately RMB576,597,000 and the 5,139,856,000 ordinary shares in issue. The calculation of basic earnings per share for the year ended 31 December 2009 is based on the net profit attributable to owners of the parent of approximately RMB470,107,000 and the 5,139,856,000 ordinary shares in issue. The calculation of basic earnings per share for the year ended 31 December 2008 is based on the net profit attributable to owners of the parent of approximately RMB520,969,000 and the weighted average of 4,834,255,760 ordinary shares in issue during the year. The calculation of basic earnings per share for the year 2007 and 2006 is based on the profit for the year attributable to the owners of the parent for each year and the assumption that 4,250,000,000 shares has been issued by the Company immediately after the completion of the capitalisation issue and during these years. HIGHLIGHTS OF CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 31 December 2010 2009 2008 2007 2006 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Assets and liabilities Total assets 12,048,938 7,247,614 5,500,861 3,597,158 4,204,311 Total liabilities 7,108,387 3,492,027 2,359,756 3,135,672 3,068,228 Total equity 4,940,551 3,755,587 3,141,105 461,486 1,136,083 – attributable to owners of the parent 3,899,584 3,417,326 2,843,246 200,758 900,306 – Minority interests 1,040,967 338,261 297,859 260,728 235,777 5 Maoye International Holdings Limited Annual Report 2010 Retail Network Term of Gross operation floor area Property Store (City) (Year)1 (sq.m.) ownership 1 Shenzhen Dongmen 14.1 47,436 Owned 2 Shenzhen Heping 11.5 23,078 Leased2 3 Zhuhai Xiangzhou 9.4 23,715 Leased2 4 Shenzhen Huaqiangbei 7.5 59,787 Leased2 5 Chongqing Jiangbei 6.5 53,542 Leased2 6 Shenzhen Shennan 4.8 10,507 Leased2 7 Chengdu Yanshikou 5.8 53,873 Owned 8 Chengdu Beizhan 5.8 7,204 Owned 9 Chengdu Wuhou 5.8 16,000 Leased3 10 Nanchong Wuxing 5.8 25,994 Owned 11 Chengdu Wenjiang 5.8 8,422 Leased3 12 Luzhou Beita 5.8 15,115 Leased3 13 Mianyang Linyuan 3.2 21,731 Owned 14 Nanchong Mofanjie 2.5 24,035 Owned 15 Mianyang Xingda 2.5 27,617 Owned 16 Qinhuangdao Jindu 2.5 46,610 Owned 17 Taiyuan Liuxiang 2.3 30,616 Owned 18 Shenzhen Nanshan 1.5 45,000 Owned 19 Chengdu Longquanyi 1.5 8,373 Leased3 20 Taizhou First Department store 1.4 40,358 Owned 21 Changzhou Wujin 1.2 22,500 Leased2 22 Chengdu Qingjiang 1.1 5,033 Leased3 23 Shenzhen Friendship 0.9 26,000 Leased2 24 Qinhuangdao Hualian 0.8 10,355 Owned 25 Qinhuangdao Shangcheng 0.8 26,696 Owned 26 Qinhuangdao Jinyuan 0.8 10,470 Owned 27 Qinhuangdao Xiandai 0.8 36,897 Leased3 28 Zibo Jindi Shopping Plaza 0.4 51,266 Owned 29 Shenyang Jinlang 0.3 70,000 Leased2 30 Baoding Guomao Store 0.3 21,831 Owned 31 Yangzhou Store 0.2 21,485 Owned 32 Zibo Dongtai Shopping Plaza 0.1 36,791 Owned 33 Zibo Dongtai Shangsha 0.1 21,229 Owned 34 Zibo Taikerong Store 0.1 25,337 Owned 35 Zibo Dongtai Shangcheng 0.1 6,800 Leased3 36 Yangquan Store — 29,740 Leased3 37 Chongqing Jiefangbei 6.2 42,000 Managed Store 38 Jiangsu Wuxi 3.3 70,350 Managed Store Notes: 1. The term of operation is up to the publication date of this annual report, and the term of acquired stores were calculated from the date of acquisition. 2. Leased from connected party. 3. Leased from independent third parties. TOTAL SALES PROCEEDS IN 2010 BY REGIONS (EXCLUDING MANAGED STORES) * As at 31 December 2010, the total sales proceeds in Eastern China have not included that of Zibo Dongtai Shopping Plaza, Zibo Dongtai Shangsha, Zibo Taikerong Store and Zibo Dongtai Shangcheng, as these stores became subsidiaries of the Company since 27 January 2011. 6 Maoye International Holdings Limited Annual Report 2010 Retail Network Shenyang Tiexi Store Taiyuan Qinxianjie Store Shandong Linyi Store Chengdu Southern Operating 38 stores as of the publication date of this annual report and at least 4 more new stores to be opened in 2011 7 Maoye International Holdings Limited Annual Report 2010 Chairman’s Statement In 2010, through the collective efforts of our management and all our staff, together with the tremendous support from our suppliers and business partners, the business of the Group maintained its rapid development momentum.